If public goods can be produced more efficiently, then
A) public goods increase, and private goods may increase or decrease.
B) public goods production stays the same, and private goods increase.
C) public goods and private goods both increase.
D) public goods production falls, and private goods production rises.
A
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If a firm happened to be the only seller of a particular product, it might behave as a price taker as long as
A) buyers have full information about the firm's price. B) the transaction costs of doing business with this firm are low. C) there are many buyers. D) there is free entry and exit.
In game theory, the outcome achieved when each player's choice does not depend on what the other player does is called:
a. the Nash equilibrium. b. the dominant-strategy equilibrium. c. the tit-for-tat strategy. d. prisoner's dilemma.
The Lojack is an example of a product that:
A. produces a positive externality. B. contributes to illegal gambling on cards. C. contributes to global warming. D. produces a negative externality.
If people do NOT always make the same mistakes when forecasting the future, then
A. the policy irrelevance theorem holds. B. the Fed can control monetary policy and determine real variables such as real GDP. C. rational expectations are irrational. D. fiscal policy is more effective than monetary policy at fine-tuning the economy.